Japanese banks appear to have sold dollar holdings to halt the currency’s slide. Although the yen recovered, experts are skeptical as to whether the relaxation is sustainable.
In the evening the yen looked stronger again. The exchange rate of 155.525 yen for the dollar was still above the 155 mark, which Japan’s financial politicians find psychologically important as the limit of weakness. But at least it was a significant jump from the new 34-year low the yen hit earlier on Monday. The fact that you had to pay 160,245 yen for the dollar at times obviously triggered an intervention measure by the government in Tokyo. The newspaper Asahi reported, citing trading sources, that Japanese banks had sold dollars for yen. The relaxation was therefore artificial. Experts are skeptical as to whether it will achieve much in the long term.